NORTH DAKOTA ASSOCIATION OF OIL AND GAS PRODUCING COUNTIES
NDAOGPC Newsletter
May 27, 2013 |
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Greetings!
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The North Dakota Association of Oil and Gas Producing Counties (NDAOGPC) is the trusted and unified voice for the betterment of the citizens of North Dakota and the membership of the North Dakota Association of Oil and Gas Producing Counties. Through this newsletter we strive to provide accurate, up-to-date information surrounding the energy activities throughout the North Dakota energy producing counties. |
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Levi Appointed as NDDOT Director
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Grant Levi, newly appointed executive director of the NDDOT.
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On Wednesday, May 22, 2013, Governor Dalrymple appointed Grant Levi as the executive director of the ND Department of Transportation. Levi had been serving as the NDDOT's interim director since November 2012 when former director, Francis Ziegler, retired from the position. Congratulations to Grant on his appointment, and we look forward to continuing to work with him in the future!
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Interstate Oil and Gas Compact Commission Holds Mid-Year Issues Summit
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 Oil and gas regulators from across the nation gathered in Point Clear, Alabama this week to discuss the ongoing issues associated with maximizing oil and natural gas resources through sound regulatory practices, while protecting our nation's health, safety, and the environment. The Interstate Oil and Gas Compact Commission (IOGCC) held its mid-year meeting May 19-21, 2013.  | |
Governor Robert Bentley of Alabama, 2013 IOGCC Chairman, delivers his Chairman's address to those at the IOGCC Mid-Year Issues Summit in Point Clear, AL.
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The IOGCC is made up of member states' governors and their appointed representatives. The organization serves as a forum for state regulatory officials to gather and share best practices, discuss federal regulatory issues, and network with other officials who may be facing similar situations in their own states. The various standing committees of the IOGCC also provide valuable information, featuring speakers who focus on everything from pending EPA rules and regulations to the potential for energy self-sufficiency in the United States. One of the speakers that was featured during the summit was North Dakota's own Lynn Helms, the director of the ND Industrial Commission's Department of Mineral Resources. In addition to his entertaining Ole and Lena jokes, Helms provided a very informative presentation entitled "Spacing and Unitization in Shale Oil Plays". Helms explained that with any unconventional resource play, unitization and spacing is important to maximize recovery rates, protect correlative rights of mineral interest owners, protect the environment, and coordinate/minimize the impacts to local residents.  | |
ND Dept. of Mineral Resources Director Lynn Helms presents during an IOGCC standing committee meeting May 21.
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Helms gave a historical perspective on how unitization and spacing have changed over the years in North Dakota. The state's mix of federal, state, and locally owned lands has made it "interesting" for development to proceed, according to Helms. As time has progressed, he said, the state has been able to continually improve upon its spacing authority to coordinate oil and gas development in a way that is both safe and effective. North Dakota currently does not have a maximum size limit for spacing units, but the standard is 1,280 acres. This standardized spacing unit size helps to reduce the negative consequences of what Helms calls a "mulit-billion dollar game of Tetris", where differently sized spacing units may make resource recovery inefficient and uneconomical. A standardized system of unitization, he said, will help everybody involved, from mineral interest owners and drilling companies who get more bang for their buck to counties who have less impacts on their roads. Helm's presentation and the presentations of other speakers are available on the IOGCC website or by clicking here. |
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Western ND County Roads to See Improvements
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The critical issue of county road improvements in western North Dakota was addressed during the 63rd Legislative Assembly at the beginning of this year. Important investments in county paved and unpaved road infrastructure were made in several bills that were passed.
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This photo, taken south of Belfield on US Highway 85, shows a glimpse of what will soon become a regular occurrence on the county and state roads of western North Dakota.
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One such bill was HB 1358, which served as the comprehensive infrastructure package bill for western ND as well as the oil and gas gross production tax (GPT) distribution formula adjustment vehicle. Two sections of HB 1358 dealt with direct funding to counties for road projects. Section 5 of the bill allocated $160 million to counties receiving $5 million or more in GPT revenue for the state fiscal year ending June 30, 2012. Those counties include Billings, Bowman, Divide, Dunn, McKenzie, Mountrail, Stark, and Williams. Section 6 of HB 1358 set out $120 million in road funding to counties receiving less than $5 million in GPT revenue in FY 2012. Western counties receiving a portion of this allocation, which is to be distributed "on or after February 1, 2014, include Adams, Bottineau, Burke, Golden Valley, Hettinger, McHenry, McLean, Mercer, Renville, Slope, and Ward counties.
In order for these counties to coordinate their projects and meet the requirements to qualify for these allocations, the ND Dept. of Transportation has created a regional map and is requesting each region to send a representative to Bismarck in June 2013. Regional representatives and NDDOT officials will then discuss county road issues, answer questions, and address any concerns that are identified.
The following are the Regions and NDAOGPC Member Counties associated with those Regions:
North Oil Region- Bottineau, Burke, Divide, McHenry, McLean, Mountrail, Renville, Ward, & Williams
South Oil Region - Billings, Bowman, Dunn, Golden Valley, McKenzie, Mercer, Slope, & Stark
SW Central Region - Adams, Burleigh, Grant, Hettinger, Oliver, Morton, Sheridan, & Sioux
More details on the NDDOT/Regional Representative meeting will be shared when a time and date are set. For now, county auditors, commissioners, engineers, and road superintendents within each region are asked to coordinate who will represent their region in Bismarck during the meeting. Please let Bryon Fuchs with the NDDOT-Local Government Division know by May 29, 2013 who will be representing your region. He can be reached at (701) 328-2516 or through email at blfuchs@nd.gov.
Western county commissioners and road superintendents are also invited to hear a presentation from ND State Health Dept. staffer Dave Glatt along with Frances Schwindt, western county dust study project director, and Gerry Fisher with the ND Energy Infrastructure and Impact Office. They will meet at the Outlaws Ballroom in Watford City, ND on June 12, 2013. The group will meet from 10am to noon and discuss dust control options for county gravel roads, including state-approved select saltwater brine from specific wells, and state funding programs.
Please have your county and road staff represented at this meeting. During the 2013 legislative session, the state legislature allocated $3 million for three counties in a dust control best practices pilot study (see article below). Another $3 million could possibly be available from energy impact grants to other counties after the pilot study is completed. The State Land Board makes the final decision on the second round of $3 million.
County commissioners are encouraged to invite their road superintendents to attend.
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EIIO Pilot Grant Round for Dust Control Grants
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The Sixty-Third Legislative Assembly appropriated funding in House Bill 1358, for the Energy Infrastructure and Impact Office (EIIO), to provide grants of $1,000,000.00 to each of three counties in oil-impacted areas under a pilot project for dust control.The three counties identified in legislative intent are Bowman, Dunn, and Mountrail.The pilot program is to assist these counties as they use different dust control products, learn from the varied use of the products, and share the results through reporting.If positive results are realized, the knowledge gained will be used in potential future dust control grant rounds for other dust-impacted counties in oil country.
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Photo courtesy of The Dickinson Press.
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Applications are now being accepted from Bowman, Dunn, and Mountrail counties. The application form is available on the energy impact website at www.nd.gov/energyimpact.
Applicants must identify the impacts being realized from dust caused by oil and gas development in their area.A project plan needs to be identified for using various types of product in an effort to address controlling dust. The applicant will be responsible for tracking the levels of success being realized and the county commission from each county is responsible for reporting the results to the EIIO Director by January 1, 2014. As a matter of reference, expenses the county has incurred the previous two years for dust control should be identified in the application.
Guidelines Applications will only be received from Bowman, Dunn and Mountrail Counties at this time. Projects submitted are eligible for an award of $1,000,000.00 for identified project costs related to this dust control trial.Expenses for dust control during the entire 2013-2015 biennium can be used toward obtaining the $1,000,000.00 award. Costs allowed include purchase of a commercially obtained dust control product, cost of obtaining oil well saltwater brine that has been approved for use by the North Dakota Department of Health, cost for transporting the product, costs for applying the product including road preparation, purchase of equipment for storage of product, equipment used in the application process, contract labor and/or labor costs to manage the project efforts including to monitor and document the results and provide the report of results experienced to be submitted by the county commission to the EIIO by January 1, 2014. The report to be filed with the EIIO Director by January 1, 2014, must identify product applied (if brine where obtained, and calcium & sodium content), date applied, application rate, results experienced in comparison to other products, costs of product per mile including transportation and application costs and if weather conditions and seasonal changes affected results. |
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Research Councils Meet and Allocate Dollars Toward Projects
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The ND Lignite Research Council voted on four projects May 21, 2013 in Bismarck, ND. Two of the projects involved research, one was for additional marketing efforts to convince people of lignite's value, and the last was for energy education curriculum development for North Dakota teachers.
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John Phillips, CCC chairman, listens to one of four presentations at the May 21 meeting in Bismarck concerning lignite.
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The two research projects illustrate the mission of the council since its inception in 1987. The mission is to make the best use of the state's lignite resources including new technologies to create a clean coal product.
The principal investigator, John Kay of the Energy and Environmental Research Center (EERC) in Grand Forks, presented a request for Advancing Carbon Dioxide (CO2) Capture Phase III. The $500,000 request would advance research on lignite and CO2 capture through pre-treatment, pre-combustion, and post-combustion technologies.
The second research project request presented was for a feasibility study of a new combination of established technologies with a new twist. Minnesota Power, through Allete, requested $150,000 of LRC dollars for a $1 million dollar study. This study would look at lignite properties and see if it's possible that CO2 could be used as a fuel rather than as an expense to capture. William Sawyer, Allete, told LRC members "what we see as a game changer." Instead of steam, coal-fired power plants may be able to use a cycle of super critical carbon dioxide. One of the reviewers expressed concern that lignite has more ash, higher water content, and other elements that might make a gasifier slurry more difficult. Mike McGroddy, Net Power, said Tioga, ND was one of the sites that the NETPower North Carolina company was considering for a test facility.
The next meeting of the LRC is November 19, 2013. More information is available on the Lignite Research Council website, http://www.nd.gov/ndic/lrc-agenda13-05.htm.
The ND Oil & Gas Research Council (OGRC) also met this week, May 23, in Bismarck. Among the council's agenda items was a research program grant funding request from John Harju, EERC, and Stan Wilson, Continental Resources. The overall goal of the proposed research program is to maximize oil production from the Bakken and Three Forks formation wells through advanced reservoir characterization, improved drilling/stimulation/completion/production techniques, and optimizing well site surface operations. Total cost of the program is $115,230,000, with $8 million being requested of the ND Industrial Commission through the OGRC.
Francis Schwindt, the lead investigator in a previously approved research project on county road dust control in McKenzie and Dunn counties, gave a report to the OGRC on the project's progress. The study, approved by the Industrial Commission in September 2011, was originally scheduled to be completed by January of 2013. However, Schwindt has identified three additional areas on which to focus his expertise. Seeking to use funds from the original amount of $220,000 that was granted in 2011, Schwindt is looking at identifying better oil field brine sources, evaluating a regional approach to procurement and distribution of aggregate, magnesium chloride, or oilfield brine, and evaluating treatment technologies that allow for the beneficial use of oilfield drill cuttings. The OGRC indicated their support for an amendment to the original contract, allowing Schwindt additional time to work in the areas outlined above.
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Upcoming Events
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CI Energy Group's Forum on Workforce Accommodation, Housing and Infrastructure for the Bakken is fast approaching. The forum, being held June 4-5 in Bismarck, ND, will equip attendees with the practical information they need to ensure organizations are prepared to address the critical housing and logistics challenges the region is facing. This first of its kind event will allow organizations to engage with top industry experts and leading government figures and gain key insights and strategies on a rapidly changing area of North Dakota. Join us on June 4-5th in Bismarck, ND. Register today by calling 1-877-927-7936 or book online at www.workforcebakken.com/ndaogpc. The North Dakota Petroleum Coun cil is again hosting its 5th Annual Bakken Rocks CookFest this year on July 16 in Powers Lake and July 18 in Parshall. CookFest is a community outreach event that is held in two communities impacted by oil and gas development and is an opportunity for the industry to give back while residents learn more about the industry and the companies operating in their area. CookFest includes a Bakken Basics Education session from 2:30 pm to 4:30 pm and live entertainment and BBQ served by industry CookTeams begins at 5:00 pm (CDT).
Finally, be sure to mark your calendars for the NDAOGPC 2013 Annual Meeting set for Thursday, September 26, 2013 in Dickinson, ND.
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Oil and Gas Stats
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WTI Crude: $93.59 
Brent Crude: $102.18
Natural Gas: $4.24
ND Rig Count: 187
From the ND Petroleum Council's News Clips for May 24, 2013
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Please take your time to review all materials and links provided for your convenience. We will continue to provide you up-to-date information on upcoming events and news happening in North Dakota's oil and gas producing counties!
Sincerely,
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Vicky Steiner
Executive Director
Brady Pelton
Deputy Executive Director
ND Assoc. of Oil & Gas Producing Counties
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